A Comparative Study of the Chinese Change of Circumstances and the UK Contract Frustration

Abstract

This study mainly focuses on the comparative study of the "change of circumstances system" in the contract law of China and the UK. This system is described differently in Chinese and English law. Chinese contract law describes it as "change of circumstances", and English contract law describes it as "contract frustration". Although there are differences in legal descriptions, the connotation and purpose of the two systems are generally similar. Generally speaking, it refers to the occurrence of unforeseen circumstances between the two parties after the conclusion of the contract, which leads to fundamental changes in the basis of performance. If the performance is illegal or fundamentally deviates from the main purpose of the contract, the status of the contract shall be changed or terminated. The purpose of the system is to maintain the fairness of the contract parties, reduce the risk of the contract parties, and promote the stability of the trading market. Some differences have emerged in the judicial practice and legislative expression of the system in the two countries. This study believes that the main reasons are the large differences in the business environment and the theoretical basis of the system between the two countries. Therefore, this study will first compare the theoretical basis of the change of circumstances system in the two countries, and then specifically compare the legislative expression and judicial practice of the system in China and the UK, and analyse the reasons for the difference. It should be stated that this comparative study aims to analyse the differences and find out the reasons for the differences and does not involve the evaluation of the advantages and disadvantages of the system.